Elbit Systems Reports Fourth Quarter and Full Year Results for 2007

HAIFA , Israel , March 11 /PRNewswire-FirstCall/ -- Elbit Systems Ltd. (the "Company") (NASDAQ: ESLT, TASE: ESLT), the international defense electronics company, today reported its consolidated results for the fourth quarter and year-ended December...


HAIFA , Israel , March 11 /PRNewswire-FirstCall/ -- Elbit Systems Ltd. (the "Company") (NASDAQ: ESLT, TASE: ESLT), the international defense electronics company, today reported its consolidated results for the fourth quarter and year-ended December 31, 2007 .

The Company's backlog of orders as of December 31, 2007 reached $4.62 billion, an increase of 22%, as compared to $3.79 billion at the end of 2006. 70% of the backlog relates to orders outside of Israel . Approximately 70% of the Company's backlog as of December 31, 2007 is scheduled to be performed during 2008 and 2009.

Full year 2007 results

Consolidated revenues for the year ended December 31, 2007 increased by 30% to $1,982 million, as compared to $1,523 million in 2006.

Gross profit for the year ended December 31, 2007 was $516.4 million, as compared to gross profit of $373.5 million in 2006, and the gross profit margin in 2007 was 26.1%, as compared to 24.5% in 2006.

The annual results were negatively affected by one-time charges related to the completion of the acquisition of Tadiran Communications on April 26, 2007 , which were charged in the second quarter of 2007. The Company recorded $27.1 million in expenses in relation to the acquisition as follows: In-Process Research & Development ("IPR&D") write-off of $16.6 million recorded under operating expenses, and restructuring expenses of $10.5 million recorded under cost of goods sold, which negatively affected the gross profit rate by 0.5%.

Consolidated net earnings for the year ended December 31, 2007 increased by 6.2% to $76.7 million, as compared to $72.2 million in 2006. Diluted earnings per share ("EPS") in 2007 were $1.81, as compared to $1.72 in 2006.

Excluding the above one-time, net charges related to the acquisition of Tadiran Communications, net earnings for the year ended December 31, 2007 were $101 million, and EPS was $2.39.

Operating cash flow produced by the Company in 2007 was $261 million, as compared to $201 million in 2006.

Fourth quarter 2007 results

Consolidated revenues for the fourth quarter of 2007 increased by 26.5% to $591.1 million, as compared to $467.4 million in the corresponding quarter of 2006.

Gross profit for the fourth quarter of 2007 was $156.2 million, as compared to gross profit of $100.2 million in the fourth quarter of 2006, and the gross profit margin in the fourth quarter of 2007 was 26.4%, as compared to 21.4% in the fourth quarter of 2006.

During the fourth quarter of 2007, the Company had a $10 million financial expense related to the write-off of investments Auction Rate Securities, which were rated AAA or AA when acquired, and which have experienced multiple failed auctions due to a lack of liquidity in the market for these securities.

The Company gained a one-time tax benefit of approximately $10 million, related to prior years' adjustments arising from executing tax settlements by the Company and some of its subsidiaries in the last quarter of 2007.

Consolidated net earnings for the fourth quarter of 2007 increased by 33.2% to $31.9 million, as compared to $24.0 million for the same period of 2006. Diluted EPS for the fourth quarter of 2007 was $0.75, as compared to $0.57 for the fourth quarter of 2006.

The President and CEO of Elbit Systems, Joseph Ackerman , commented: "2007 was a banner year in which we continued our top line growth while producing record net profit, EPS, backlog and operating cash flow. We have been very successful in further globalizing our business, with strong growth in Europe , and we now have presence in important and diversified geographic regions, with a cutting edge comprehensive product portfolio for the evolving needs of the markets in which we are active."

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